A dietitian's nightmare, consumers just yawn

Kraft Foods Inc. and McDonald's Corp. are spending millions of dollars to remove trans-fatty acids from some of their products and to disclose the trans-fat content of others.

But do consumers really care?

No, says a new study by Washington-based market research firm Hartman Group Inc. Only the very health-conscious  about 14% of the population  routinely avoid food containing trans fat, the firm found.

The trans-fat issue illustrates the tough spot major food suppliers are in. If they fail to respond to what has become a steady barrage of health concerns, food companies risk losing marketshare to nimbler producers that do adjust their recipes. But for the biggest companies, like McDonald's and Kraft, making existing products healthier is often at best a defensive tactic, helping to hold onto marketshare but doing little to enlarge it.

Robert Goldin, executive vice-president of Technomic Inc., a Chicago-based food industry consulting firm, says reducing and removing trans fat is more about "satisfying the demand of existing customers than attracting new ones. Drawing in new customers will likely be a function of product innovation and marketing."

However, some existing customers will miss the fat. Take Rob Borucki, who eats food rich in trans fat three to five times a week. The 37-year-old Mesa, Ariz., man maintains FastFoodSource.com, a Web site for junkies like himself. His favorite meal: a McDonald's No. 1 combo of Big Mac, french fries and pop.

"I have to have McDonald's with some regularity or else I suffer withdrawal," says Mr. Borucki, who works for America West Airlines' Internet division when he isn't posting to his own Web page. "I think there's an awareness of trans fat that has grown with time, but I don't know that that curbs people's consumption and I don't know that anyone would care if it's broken out on nutrition labels."

The Food and Drug Administration is requiring all food manufacturers to disclose trans-fat content by January 2006, and Northfield-based Kraft is in the process of relabeling 4,000 products, according to a company spokeswoman.

But the Hartman Group predicts the new information will have minimal impact on buying behavior. "The majority of consumers say they look at nutritional information on packaging when making decisions about whether or not to purchase a product. But this is done most frequently when purchasing a product for the first time," the Hartman study notes. "Labels are not used as often for brands that are staples in the household."

Kraft's staple Oreo cookie became the poster product of the anti-trans-fat movement in May 2003 when BanTransFats.com Inc., a California non-profit advocacy group, sued the company for marketing and selling Oreos to kids. After news of the case spread, Kraft pledged to remove trans fat from the cookies and BanTransFats dropped its suit. Kraft has since developed three varieties of trans-fat-free Oreos and has removed trans fat from 45 other products, including Wheat Thins, which are hitting store shelves now.

SECOND SUIT

McDonald's has been under pressure to do the same. The Oak Brook-based burger chain announced two years ago that it would cook its fries in oil containing less trans fat by February 2003. But then it backed down, saying it needed more time. So BanTransFats sued McDonald's.

"McDonald's continues to work hard to achieve our goals for reducing" trans-fatty acids, the company says in a statement to Crain's. "We have already made progress and have reduced (trans-fatty acid) levels in our Chicken McNuggets, Crispy Chicken and McChicken offerings. As we reported in February of 2003, the change has taken longer than anticipated, but we are continuing with ongoing tests."

Reformulating food while preserving its flavor and texture is no small  or inexpensive  task. Kraft declines to divulge the cost of its reformulating and relabeling efforts, but the Grocery Manufacturers of America says trans-fat-free product development "can approach tens of millions of dollars per company."

Although most consumers don't yet care about trans fat, the Hartman Group says adjusting recipes before customers worry deeply about a health issue is probably money well spent. "It is very likely that the industry itself will have pre-empted any major consumer backlash at the register."

Even Mr. Borucki's heavy use has softened over the years. He eats half as much fast food, and half as often, as when he was in his 20s. "As I get older, I know I can't eat a double cheeseburger at midnight anymore," he says. "I miss those days. Those were good times."